If I own a vacation home in Puerto Rico, what will happen to it ifI file for bankruptcy?

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If I own a vacation home in Puerto Rico, what will happen to it ifI file for bankruptcy?

I would like to file Chapter 7. I can homestead my first home and let the bank take my second home (its in foreclosure). Can my creditors take my home in Puerto Rico that is now worth much less but I own free and clear and was my vacation home? I also have about $50,000 in credit card debt.

Asked on November 18, 2010 under Bankruptcy Law, Florida

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 13 years ago | Contributor

Your vacation home is an asset of yours. That means that it needs to be included in your bankruptcy filing and is an asset which could be ordered to be liquidated (or sold) and the proceeds thereof distributed for the benefit of your creditors. Since Puerto Rico is part of the U.S., creditors would not even face the procedural problems that would face with a foreign jurisdication (e.g. Canada or Mexico); instead, reaching a vacation home in Puerto Rico is no harder than reaching one in North Carolina. If you have a fully paid up vacation home, if selling it would provide enough money to pay off your debts, you may wish to consider doing that instead. If you want to file bankruptcy and  try to keep the home, you may wish to consider chapter 13 instead as an option.


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